“Major U.S. growth mutual funds have been among the largest sellers of Apple Inc. shares over the past six months, fueling speculation that the company’s days of supercharged growth have come to an end,” David Randall reports for Reuters.
“Amid concerns that iPhone sales may be set to drop, the $77.3 billion American Funds Capital World Growth & Income Fund has sold all of its 1.7 million Apple shares since the end of June, according to Lipper data,” Randall reports. “The $9.3 billion Hartford Capital Appreciation Fund sold 1.4 million shares over the same period, reducing its position by 91 percent.”
“The selling of Apple stock by growth-oriented managers, who seek higher returns from fast-expanding companies, pushes Apple further toward being a so-called value stock – more appealing for its balance sheet or cash than its growth prospects,” Randall reports. “The transition of Apple to more of a value than a growth investment is underway at funds giant Fidelity. Its growth-oriented Fidelity Capital Appreciation fund has sold all of its 2.48 million Apple shares since June, according to Lipper data. At the same time, the value-oriented Fidelity Series Equity-Income fund bought 1.05 million shares after having no previous stake, and making it one of the ten largest buyers in the second half of last year.”
Read more in the full article here.
MacDailyNews Take: Until Apple’s next big catalyst, it makes perfect sense for growth funds to divest and for value-oriented funds to stock up. We’ll see what Apple says – and, more importantly, what Apple guides – on the 26th.
The problem with mutual funds is that you pay high management fees for poor fund management. Subtract the management fees from any return you may have had, and the net return will likely make you sad. So what are those ‘safe’ growth stocks these managers are buying ? [crickets]
I’ve invested with Vanguard for years and I’m doing just fine. If you don’t pay attention to what these outfits take then you deserve what you get, but for the majority of average investors mutual funds are the logical way to go.
Vanguard is not the worst, but not the best. Returns over the past 2 years are nothing to write home about – there was not enough to pay for the stamps. Yes they made you money when it was easy to make money in the market. Now, not so much. Mr. Baloney, don’t equate any luck you may have had with the performance of mutual fund managers. The only concession I would make is that mutual funds are better than keeping money in a bank or your mattress.
Hey, how do you know that wasn’t posted by my wife, Mrs. Baloney? 🙂
Haha. Mrs. Tincan posts for me when I have naps.
A two year time frame is to short for a serious investor who has other things to do with his life besides follow the market. Speculators and Traders may think 2 years is a long time, but those in the know, know differently.
John Bogle’s rationale behind his Vanguard Funds is intellectually unassailable.
1. Most people are content with low-risk investment returns of their hard-earned savings that track the overall stock market. Overall, the stock market has returned an average of nearly 8% per year since 1928.
2. Stock picking is risky business, even for professionals. Most fail to beat the market averages, and professionals may do considerably worse when management fees are considered
3. Stock fund fees are surprisingly high when calculated as a % of investment returns rather than as a % of ASSET base. An annual management fee of 1% of ASSET VALUE represents 12.5% if the investment return is 8%. It represents 25% if the investment return is 4%. And represents 50% of an investment return of just 2%. Investors pay fees to fund managers even in years the fund may lose money. Fund fees are higher than most people realize. Due to the effect of compounding — only in reverse, as fees represent negative growth — the impact becomes huge in time.
4. To achieve low-risk, optimal stock investment returns, most investors would be better off in a (quality) stock index fund with the lowest fees than in stock picking funds that charge higher fees. The fees add up in time and greatly reduce an investor’s returns and accumulated assets.
The long-run is the best way to consider any investment. As mentioned, the long-run return of the stock market has been almost 8% per year since 1928. The result for any 2-year period is almost meaningless.
If people want to pick their own stocks, they should do so on their own account, not through a broker that charges management fees. (Unless, of course, you like to talk with your broker; but understand that the broker is probably not doing you any favors in terms of optimizing your returns.) Discount brokers offer fees as low as $8 per trade regardless of # of shares or value are available.
Great points. #3 is an important one. The management fees are charged regardless of performance. This has always troubled me especially when you look at the limited information provided on funds website. i would prefer that there is a penalty if growth is not obtained in a year.
Awesome post! Covers the key issues succinctly. Actively managed funds make money off of investors – the surest way to make money year after year. Very few actively managed funds beat the indices over a five-year or ten-year period.
Investors need to check out *all* of the fees charged by mutual funds, including those digustingly awful 12b-1 fees that are just legalized theft.
C’mon. You know darn well they’re piling into the great F.A.N.G. stocks and Microsoft as well. Amazon, Google/Alphabet and Microsoft are the likely big leaders in cloud services. Exactly what cloud services does Apple have? Nada.
Cloud services really excites investors due to the stories of how everyone will be dumping in-house computers and doing everything in the cloud, so growth is (pardon the pun) VIRTUALLY unlimited. This is simply another chance Apple had at creating a huge market for itself but did nothing with their mountain of money. Now, Apple sits as the odd man out. Mind you, I think Wall Street tends to exaggerate cloud services market growth and profits but that’s what greedy investors love to hear. Just glance at the institutional ownership percentage of the companies I mentioned and Apple ownership looks pathetic compared to them. Apple always look like the lame-o player who gets picked last to be on the team.
So, while all the smart companies who have cloud services are increasing their institutional ownership, Apple is being dumped and being called a dying business desperately in search of a new revenue stream.
Thank you for once again sharing your vapid stupidity, idiot troll.
Welcome back
Mag… Hmmm, I say you are right and WRONG. But that is the usual.
First of all, (FANG) what does the F-Air National Guard have to do with stock?? LOL Shows my age. 🙂
Second, Apple now sells you 50 GIG of cloud for 1$ a month. WOW, plenty and cheap. And once I found out how to access it like Dropbox, its clean and simple and costs Apple little due to green energy at server centers. 🙂
And as far as the market, I looked at Friday and Apple, Microsoft and NASDAC all looked exactly the same. So where are the articles about Microsoft doom, and the market doom??
Apple is being played and so are dumb, lazy stock owners. PS about the Mutuals dumping Apple….. since June, consider they sold when it wavered at around 129-132 and are just waiting to get back in at 100……. 30 $ a share PROFIT. But no blogger will write about that will they???
We’ll all seen how these metal fund managers are very much imperfect. Remember when they were loading up on housing stocks before the housing bubble burst? How many of them correctly predicted that huge financial crisis?
As to Apple, as others have mentioned, we will see the results. As to growth, there is still much room for growth in the smartphone market, but one problem seems to be the world economy at large. But that will pick up again at some point in time. China is still a massive opportunity. And great companies gain market position during slowdowns.
My mutual funds are all growth funds but still most of the gains comes from dividends. Most of the stock picks are basically on the bandwagon.
The notion that you off-load Apple stock when it is at its low is almost criminal.
“The notion that you off-load Apple stock when it is at its low is almost criminal.”
Are you suggesting that selling low is not good investment policy?!?!? The next thing we know you will be suggesting that people not buy at the high points. 🙂
As a lowly investor I would not dare to suggest that I know more about the stock market than the fund managers.
I’m kicking myself that I did not sell my Apple stock several years back when it was around 60.
I would say that the decisions people make about investing differ depending if it is their own money or someone else’s.
Only “provisional share holder” would have any regrets about not selling two years ago. You probably didn’t have enough shares to matter or enjoy the dividend yeilds that enabled all real Apple investors to weather the storms without concerns or regrets.
Probably should have added /s to my post.
Was scratching my head…
It’s Apple’s game and the meek will lose. Apple has been playing it for years. Apple feeds use moderate changes until it’s time for something major to get folks excited again, and everyone from corporate execs to homeless guys with a wad of cash in their pockets will be in line for the iPhone 7. Something visually clear so people know you have the new phone (fashion is big) and 1 or more technologies we’ve been clamoring for, like multiuser capability. Now you can hand your phone to the kids with peace of mind!
I just wish they’d buy Dropbox, and bring FileMaker back into the fold. FileMaker is a golden egg they are wasting. Using FileMaker they could go toe to toe with Salesforce.com. Enterprise apps across Mac and iOS easily developed and deployed.
Pretty sure they did try to buy Dropbox at one time, they refused all offers.
IO Mac.. Have you checked iCloud storage yet??? I use dropbox and its nice but an Apple store guy shows me how to use Apple iCloud. Open finder, click on iCloud and it works just like dropbox and will be available on all your computers.
I get 50 GIG for 1$ a month. 50 Gig! No its not enough to LIVE in the cloud but for common files, its way better than the 4 Gig that Dropbox gives you.
Check it out.
The article mention sale of abou 6 million shares by 3 funds .
Average daily volume for apple is about 45 million shares.
Plus … Apple has about 5.5 billion shares on float..
Just putting things in perspective ..
This.
And representing just 0.001% of outstanding shares.
It’s a storm in a teaspoon.
More cutting Monday. More cutting campers. I told you to sell long ago but you didn’t and are stupid. More cutting on Monday.
Go Trump!
x you do realize that monday is a federal holiday and the market is closed, right??? So the whole cutting on monday thing is …… well, like most of your other comments….. lacking a bit of wisdom….
Just saying.
I like Trump. You should try to talk like him more, you might be more popular.
Apple should rush to open couple stores in Iran, since the sanction has been lifted.
I just saw The Big Short this weekend and it reminds me of this market. Apple’s whole strategy is changing to essentially put Google out of monetizing clicks via web advertising. What is very interesting is Google and Amazon are not showing any growth but the long positions are growing, making them ripe for shorting. At the same time, iPhone is being touted as a loser, which is AMAZING since it has never been a loser. Now, just before the crash of 2007, CDO prices went through the roof before they came crashing down, unleashing the worst recession since the Great Depression. Some hedge funds seem to be understanding the market: Apple is getting rid of advertising on its highly sought demographic products, killing Google’s ability to monetize information about you. Apple is making you and your habits more private. If this gets out, Katy bar the door on the iPhone. Even MacDailyNews is going to be nervous about how to make money without charging a subscription. Watch out, folks, I think Tim Cook and Obama have made a private deal, I think Microsoft and Apple have decided to kill Google jointly and if you have any money to buy stock with, now is the time because Google is going to be in trouble within 2 years as internet advertising DRIES UP and premium app and hardware purchasing INCREASES. Apple should be a trillion dollar company within 3 years unless a Republican becomes President! If that happens, we should have a depression within 3 years!
Oh so insightful!
What are the most OVER-valued companies on the stock market? Two of them are Google and Amazon. But the hypnotized disagree! (0_o) (o_0) ‘Must Buy More Bubble Priced GOOG! Must buy…’ 😆
I watched a ‘stock market expert’ on the TV go all ga-ga about how iPhone sales are gonna die! It was like watching someone who had been hypnotized into believing they were a chicken. His insistence that it was gonna happen was stunning and reminded me how susceptible to bullshit we all are, when properly presented to us. ‘Your eyes are getting heavier and HEAVIER!’
So, you ‘growth’ funds dumping Apple: DUH. You’re not gonna grow very much when the market corrects itself again after this era of FUD mongering. Just saying! Wake up! What’s the most solid stock on the market that’s the most undervalued? I know which one!